MANY small businesses will suffer as a result of the latest Budget, says a Keighley accountant.
Dave Forrester, of TaxAssist Accountants, said the new compulsory living wage – £7.20 an hour from next year and £9 by 2020 – announced by the Chancellor would have a significant impact.
"It will make small businesses consider whether employing people is a sensible decision," he said.
"It will be offset by an increase in the employment allowance from £2,000 to £3,000 a year, but this will not compensate for the rise in wages and sole director companies are set to lose this benefit next year as well as losing some of the tax-free status of dividends.
"And when you consider that recently published HMRC guidelines mean that self-employed people will have their tax credits assessed on the basis of earning the minimum wage – rather than what they actually earn, which is often less than minimum wage – a lot of self-employed people will be significantly worse off."
But Mr Forrester said an annual investment allowance of £200,000 and a reduction in corporation tax would be welcomed.
He added: "Businesses which depend on cars and vans to deliver their products and services will also breathe a sigh of relief that fuel duty remains frozen."
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